Obamacare repeal has insurance industry scared

The insurance industry did a lot of crying about Obamacare, even though we’ve known for a while it was going to be big business for them. Now they’re crying because – heaven forbid! – a Romney victory, along with a GOP-controlled House, might mean chaos for their business as the GOP attempts to follow through on its threat to repeal health care reform.

Poor babies, right?

Despite all of the talk by Republicans about how disruptive Democrats are for business, it sure sounds like it’s the Republicans who are the making life unpredictable for business. This time for the insurance industry.

The big new element on Friday was an official outside recognition that U.S. creditworthiness is being undermined by a new factor: political insanity. S&P didn’t base its downgrade on a change in the U.S. fiscal and economic outlook. It based it on the political game of chicken over the debt ceiling, a game that Republicans initiated and pushed to the limit, and on a growing gloom about the partisan deadlock. Part of S&P’s gloom, moreover, stemmed explicitly from what a new assessment of the GOP’s ability to block any and all tax increases.

S&P was remarkably blunt that its downgrade was mostly about heightened political risks: “The political brinksmanship of recent months highlights what we see as America’s governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed,” it said….

To be sure, S&P didn’t specifically single out Republicans. It criticized the overall $2.4 trillion deal as too limited, and it implicitly criticized both political parties for refusing to tackle their sacred cows – entitlements, in the case of Democrats; tax increases in the case of Republicans.

But it’s hard to read the S&P analysis as anything other than a blast at Republicans. In denouncing the threat of default as a “bargaining chip,” the agency was saying that the GOP strategy had shaken its confidence. Though S&P didn’t mention it, the agency must have been unnerved by the number of Republicans who insisted that it would be fine to blow through the debt ceiling and provoke a default.

And now Big Insurance has suddenly woken up to the fact that Republican insanity is bad for business. Maybe they should have thought about that before joining the GOP in ripping Obamacare.

Although the industry hates parts of President Barack Obama’s health care law, major outfits such as UnitedHealth Group and BlueCross Blue Shield also stand to rake in billions of dollars from new customers who’ll get health insurance under the law. The companies already have invested tens of millions to carry it out.Were Romney elected, insurers would be in for months of uncertainty as his administration gets used to Washington and tries to make good on his promise repeal Obama’s law. Simultaneously, federal and state bureaucrats and the health care industry would face a rush of legal deadlines for putting into place the major pieces of what Republicans deride as “Obamacare.”

Would they follow the law on the books or the one in the works? What would federal courts tell them to do?

Looking at the strange and destructive insanity of the GOP, let’s take a guess how a GOP Congress might react.

Chris in Paris
An American in Paris, France. BA in History & Political Science from Ohio State. Provided consulting services to US software startups, launching new business overseas that have both IPO’d and sold to well-known global software companies. Currently launching a new cloud-based startup. Full bio here.